BHP CEO warns on shale gas cost ….& fossil-fuel divestment.

FT: “Relying on shale gas would be a “very expensive” solution to meeting the world’s growing demand for energy, the chief executive of BHP Billiton, the mining, oil and gas group, has said.”“Andrew Mackenzie, who took over at BHP last year, also called for a price to be put on greenhouse gas emissions to address the threat of global warming, and said the mining industry needed to do more to develop technology to capture and store carbon dioxide.
Speaking to the Financial Times in Houston, Mr Mackenzie said it was “completely impractical” to suggest that shale gas could be the sole answer to providing affordable energy for the world while cutting carbon emissions.
….He expects natural gas to be the world’s fastest-growing fossil fuel over the next three decades, and BHP has committed to investing $4bn a year in capital spending in its shale oil and gas business, in a planned total across the group of $16bn.
It has had a bruising experience in US shale, being forced to write down $2.8bn in 2012 on assets it acquired the previous year for $4.8bn. However, it has been working to improve the efficiency of the business and says it has cut production costs in the Eagle Ford oil and gas shale formation of south Texas by 30 per cent over the past year.”SMH: “A ban on fossil fuel investment would ”seriously” slow global economic growth, and many of the people advocating such measures were speaking from northern hemisphere points of view, according to BHP Billiton chief executive Andrew Mackenzie.
Speaking in the wake of Norway’s decision to investigate whether its sovereign wealth fund should be banned from investing in coal, oil and gas, Mr Mackenzie said such debates often failed to properly understand the realities of life in poorer and developing countries, where 20 per cent of the world’s population still does not have access to reliable forms of energy.
….At $US840 billion ($942 billion), the fund is the world’s biggest, and is also an important shareholder in Woodside Petroleum, Whitehaven Coal, Glencore Xstrata, BP, Shell, Chevron and ExxonMobil.
….When asked if BHP would speak to Norwegian officials to make sure its views were heard, Mr Mackenzie said: ”They are a major shareholder of this company and therefore I speak to them all of the time, because they actually in some ways are my boss. So we have very regular dialogue with our major shareholders, particularly in more recent weeks when we have just come off [half-year] results.”